'Do this for as long as you can, and you will be a multimillionaire’: Self-made millionaire Ramit Sethi

Ramit Sethi is also the host of 'I Will Teach You to Be Rich' podcast.

Self-made millionaire Ramit Sethi has an important piece of advice for freshers and young professionals -- one that can turn them into millionaires. "Invest 10 percent of your salary every year," the 41-year-old  American writer of Indian origin told CNBC Make It. "And at the end of the year, increase that by 1 percent. Do this for as long as you can and you will be a multimillionaire.”

Elaborating on how one can go about it, Sethi suggested buying low-cost index funds and following the stock performance of around 500 large US publicly traded companies, including Microsoft, Apple, and Nvidia.

"By investing in an index fund, your money is spread across a wide range of companies, which automatically diversifies your portfolio," the host of I Will Teach You to Be Rich podcast told the publication. "And since index funds are passively managed and simply aim to mimic a market index’s performance and returns, they tend to have lower costs than actively managed funds."

Sethi added that the key to investing is to start sooner rather than later because "when you begin early, you give your money a longer amount of time to grow through the power of compound interest" as one can earn interest on both the contribution and the interest it earns over time.

"If 10 percent seems steep to you, don’t panic. It’s okay to start by setting aside what you can and work your way up to a larger portion of your income down the road," he said. “By starting at your college graduation with your first job, you will set yourself up for a lifetime of living a rich life.”